NOTE: As provided in LFC policy, this report is intended for use by the standing finance committees of the legislature.  The Legislative Finance Committee does not assume responsibility for the accuracy of the information in this report when used in any other situation.

The LFC is only preparing FIRs on bills referred to the Senate Finance Committee, the Senate Ways and Means Committee, the House Appropriations and Finance Committee and the House Taxation and Revenue Committee. The chief clerks are responsible for preparing and issuing all other bill analyses.

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(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates/Conflicts with/Companion to/Relates to

SOURCES OF INFORMATION

State Department of Education

LFC

SUMMARY

Synopsis of Bill

The bill changes the specifications for instructional material funding and eliminates the 70% adopted and 30% non-adopted allocations. The legislation allows local school districts, state institutions or adult basic education centers to use their entire instructional materials allocation for items not included on the multiple adoption list.

Significant Issues

The current instructional materials adoption process involves the State Board of Education issuing a Request for Proposal ( RFP) based on a 6 year cycle. This cycle spreads out the district's instructional materials purchases over a planned time frame that is connected to a statewide content standards. The State Board of Education reviews the recommendations of an appointed commission and decides the materials to be placed upon the multiple adopted list. School districts must use 70% of their allocation to purchase off the multiple adoption list. They can use the remaining 30% of their allocation to make purchases directly from companies.

SDE reports that some expected outcomes of this legislation would be:

• Dramatic drop on the number of publisher responding to the RFP process
• Reduction on the number of items appearing on the multiple adoption list
• Loss of price protection in the six year instructional materials process ( prices must be kept constant for 6 years)
• Loss of protection under " the favored nations clause" (materials on the list must be sold in NM at the lowest price offered nationwide).

FISCAL IMPLICATIONS

SDE mentions that schools ordering directly from the publisher would experience a significant increase in administrative costs for the processing of orders and providing payments directly to publishers. Moreover, they would have to deal with a number of publishers.

ADMINISTRATIVE IMPLICATIONS

SDE explains that schools that don't order off the multiple list would have increased responsibility for accuracy of orders and payments. They would also have to correlate the selection of materials with statewide student content standards.

OTHER SUBSTANTIVE ISSUES

SDE Indicates that the current adoption process :

• Ensures that materials correlate with State Board student content standards
• Ensures that materials correlate with the statewide standardized testing program
• Centralizes the order processing , billing and publisher payments
• Provides private schools with ample materials to purchase off the multiple adoption list

CF:BD/njw